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February 4, 2015

New Math

Thanks to Sandra McFadyen at the Disabled Persons Commission, I learned that StatsCanada has a new survey on disability, which is presented on fact sheets at the Disabled Persons Commission, so herewith some revised estimates. I left the original post.
My friend Contrarian challenged me to get serious about the economics of accessibility.
I'm just a wheelchair user, so I tend to think about accessibility in terms of ramps and washrooms. Let's make some informed estimates.
I like restaurants, but many are in inaccessible buildings. They've been restaurants for a long time, so under the provincial building code, they're grandfathered as to inaccessibility. What would it cost to make them accessible, would there be any benefits and what would be a good way to make it happen? Here are some numbers:
According to Restaurants Canada, 60.6% of Canadians eat at a restaurant once a week or more.The population of Nova Scotia, age 15 and over is 765,100. I was using the total population.
Here is some figuring on disability:

Category

Factor

Running Total

Nova Scotians age 15+

100%

765,100

With a disability

18.8%

143,839

Mobility

53.0%

76,235

Moderate

21.7%

16,543

Dine out at least once a week

60.6%

10,025

Meals per year

52

521,300

The subjective variable here is severity of disability. StatsCan is cautious:....disability severity is a strong predictor of the reduced participation of people with disabilities in several domains of everyday life (Federal Disability Report, 2010). People with severe disabilities are less likely than their counterparts with milder disabilities to participate in the labour force, to attend and complete post-secondary education programs, and to participate in community activities.
Here's my interpretation:

Severity of disability

Likelihood of dining out

mild

Probably could go to any restaurant, though it might be a nuisance.

moderate

Probably can't do steps and needs some washroom amenities, but would love to dine out.

severe

Might go to a restaurant, but probably would rather not.

very severe

Wouldn't go.

This much is indisputably correct: According to Statistics Canada and Restaurants Canada the potential for dining out among Nova Scotians age 15 and over with moderate mobility disabilities is 521,300 meals per year.
I can personally testify that some of that demand is already being met, though none of it at inaccessible restaurants. Let's say two-thirds of those meals don't happen presently, leaving a new business potential of 347,533 meals. I made this 2/3 instead of 1/2, being reminded by Elizabeth Braid that few eat alone.
Hold that thought. Now let's turn our attention to restaurants.
According to Statistics Canada there are 1540 full-service restaurants and limited-service eating places in Nova Scotia as of January 2015.
Some of them will need extensive renovations to become accessible. Some already are accessible. Others, like Hali-Deli just got a free portable ramp. Some have a useful washroom, some have no washroom at all. Here's a table to help think about it:

Cost to make accessible

Proportion of restaurants

# of restaurants

$500

$2,500

$5,000

$7,500

$10,000

$15,000

25%

385

$192,500

$962,500

$1,925,000

$2,887,500

$3,850,000

$5,775,000

50%

770

$385,000

$1,925,000

$3,850,000

$5,775,000

$7,700,000

$11,550,000

75%

1155

$577,500

$2,887,500

$5,775,000

$8,662,500

$11,550,000

$17,325,000

100%

1540

$770,000

$3,850,000

$7,700,000

$11,550,000

$15,400,000

$23,100,000

If all 1540 restaurants had to spend $15,000 to become accessible, it would cost $23,100,000. My estimate is that about half of restaurants are inaccessible, and that $7500 would go a long way towards fixing the problem. Here are my figures:

Way under $7500. The ramp is very nice and comes ready-to-assemble - meets code. Covers 2 steps. Fixtures are Home Depot prices. Labour is extremely generous, probably way too much. This assumes the restaurant already has a bathroom, at least 2X2 meters, that needs renovating.

So a $7,500 upgrade of 770 restaurants would cost $5,775,000.

Suppose the Province made a grant for the renovation. What's the payback? Well, It depends on the price of a meal:

Cost of a meal

Annual Business Increase

Per Restaurant

Provincial HST portion

Years to recoup $7500 grant to 50% of restaurants

$10

$3,475,333

$2,257

$347,533

16.6

$25

$8,688,333

$5,642

$868,833

6.6

$50

$17,376,667

$11,284

$1,737,667

3.3

$75

$26,065,000

$16,925

$2,606,500

2.2

$100

$34,753,333

$22,567

$3,475,333

1.7

My favorite meal on the planet is clams & chips and a chocolate shake at John's Lunch in Dartmouth, which runs $23.23 tax included. Let's take $25 for an average price - I think $30 is more realistic but $25 will do.

So here's the bottom line:

10,025 Nova Scotians with moderate mobility disabilities might represent a new customer base of 347,533 meals at the province's restaurants. If the Province gave $7500 grants to 770 restaurants to make them accessible, it would recoup the investment through HST in 6.6 years at an average meal cost of $25.

The 770 restaurants each increase business $5,642 per year.

Gus Reed

PS this doesn't account for the HST on what the grant is used for, any increased income taxes from new employees, increases in property taxes, whatever.

One in One Thousand - The forgotten legacy of James McGregor Stewart

James McGregor Stewart, 1889-1955, son of a Pictou lawyer, grandson of a Cape Breton minister, was a principal of Stewart, McKelvey, the downtown Halifax law firm. In his time he was Nova Scotia’s premier corporate lawyer, and he wrote the rules for many of our most successful and long-lived companies. He was president of the Canadian Bar between the wars. He is one of fewer than 500 Canadians to be awarded the Commander of the British Empire for services to the Empire in WW II. His obituary was in the New York Times.
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